The Type of Standard That Provides Allowances for Normal Amounts

question 244

Multiple Choice

The type of standard that provides allowances for normal amounts of waste and inefficiency in the production process is referred to as a(n)

• A)ideal standard.
• B)perfection standard.
• C)realistic standard.
• D)practical standard.

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Definitions:

Production Data

Information related to the manufacturing process, including quantities produced, machine hours used, and raw materials consumed.

Equivalent Units

A concept in process costing that converts partially completed units into a number of fully completed units for accounting purposes.

Physical Units

A measure used in cost accounting to quantify units of production or inventory in a tangible, countable form.

Percentage of Completion

An accounting method used to recognize revenues and expenses of long-term projects proportionally to the work completed.